WASHINGTON - Yesterday, President Obama signed Executive Order (E.O.) 13599 that takes a number of actions in furtherance of the Administration’s Iran sanctions program, including measures to implement section 1245 of the National Defense Authorization Act (NDAA). Among other things, the E.O. freezes all property of the Central Bank of Iran and all other Iranian financial institutions, as well as all property of the Government of Iran, further tightening the already broad-based and stringent U.S. sanctions on Iran.

These actions underscore the Administration’s resolve to hold the Iranian regime accountable for its failure to meet its international obligations.Iran now faces an unprecedented level of pressure due to intensified sanctions applied by the United States and complementary actions by many others around the world.The new E.O. issued today reemphasizes this Administration’s message to the Government of Iran – it will face ever-increasing economic and diplomatic pressure until it addresses the international community’s well-founded and well-documented concerns regarding the nature of its nuclear program.

Additional information describing the implementation of section 1245 of the NDAA pursuant to the authorities delegated under this E.O. will be made available in the near term.

Sanctions under the New Executive Order:

On February 5, President Obama signed a new E.O. effective at 12:01 a.m. on February 6, that blocks (i.e., “freezes”) all property of the Government of Iran as well as all property of Iranian financial institutions, including the Central Bank of Iran.

1. The E.O. blocks all property and interests in property of the Government of Iran, the Central Bank of Iran and all Iranian financial institutions (regardless of whether the financial institution is part of the Government of Iran) that are in the United States, that come within the United States, or that come within the possession or control of U.S. persons.Previously, U.S. persons were required to “reject,” rather than “block,” Iranian transactions.

Under the order, the Government of Iran, the Central Bank of Iran, and all Iranian financial institutions are now blocked (i.e. their assets within the jurisdiction of U.S. persons are frozen).

The U.S. sanctions in place since 1995 have required most transactions involving the Government of Iran, the Central Bank of Iran and all Iranian financial institutions to be rejected – that is, they could not pass through the U.S. financial system, but instead were turned back.Under the new E.O., transactions involving the Government of Iran, the Central Bank of Iran and all Iranian financial institutions that previously would have been rejected will now be blocked.

All entities that meet the existing definition of “Government of Iran,” such as Iranian ministries, state-owned entities and commercial firms owned or controlled by the Government of Iran, are blocked.This includes entities bearing the [IRAN] tag on the Treasury Department’s Office of Foreign Assets Control’s (OFAC) List of Specially Designated Nationals and Blocked Persons (SDN List).Transactions by U.S. persons involving such entities are now blocked unless exempt or otherwise authorized.OFAC will continue to update the SDN List and may add, delete, or edit existing entries as appropriate.

The E.O. does not change the sanctions that may be applied against foreign financial institutions engaging in arms-length transactions with certain Iranian financial institutions, including the Central Bank of Iran.Those foreign financial institutions remain at risk of U.S. sanctions if they engage in certain significant financial transactions with the Central Bank of Iran or certain other designated Iranian financial institutions pursuant to the NDAA, or the Comprehensive Iran Sanctions, Accountability, and Divestment Act of 2010 (CISADA).

2.Treasury is issuing general licenses to maintain existing authorizations for certain transactions that advance U.S. foreign policy interests.

Persons who currently use general or specific licenses from OFAC for transactions involving the Government of Iran or Iranian financial institutions should consult the OFAC website for new general licenses and other information on whether those transactions remain authorized under the new E.O.

Delegations of Authority under the New Executive Order:

The E.O. also delegates other authorities provided in section 1245(d) of the NDAA.

The E.O. delegates a number of other authorities provided in section 1245(d) of the NDAA, primarily to the Departments of the Treasury and State.These delegations will facilitate the implementation of section 1245 of the NDAA.

Additional information describing the implementation of the NDAA under these delegated authorities will be made available in the near term.